Note 9 - Income Taxes

12 Months Ended

Apr. 30, 2023

Notes to Financial Statements

Income Tax Disclosure [Text Block]

9. INCOME TAXES:

Deferred taxes are determined based on the estimated future tax effects of differences between the financial statements and tax basis of assets and liabilities given the provision of the enacted tax laws. Significant components of the Company's deferred tax liabilities and assets as of April 30, 2023 and 2022 are as follows (in thousands):

	April 30, 2023			April 30, 2022
Deferred tax liabilities:
Deferred compensation, restricted stock	$	(166	)	$	(358	)
Total deferred tax liabilities		(166	)		(358	)
Deferred tax assets:
Depreciation and amortization		325			1,365
Research and development		738			-
Accounts receivable allowance		55			55
Inventory and other allowances		74			65
Lease right-to-use		114			472
Compensation accruals		156			60
Jackpot reserves		177			111
Total deferred tax assets		1,639			2,128
Less valuation allowance		-			-
Net deferred tax asset	$	1,473		$	1,770

The reconciliation of the federal statutory income tax rate to the effective tax rate is as follows:

	April 30, 2023			April 30, 2022
Statutory federal income tax rate expense, net of noncontrolling interest		21.00	%		21.00	%
State income tax, net of federal benefits		5.90	%		5.38	%
Permanent tax		2.19	%		-1.12	%
Other		1.72	%		-1.25	%
		30.81	%		24.01	%
Income tax expense:
Deferred income tax	$	297		$	174
Current income tax		1,714			3,102
Total income tax expense	$	2,011		$	3,276

Current income tax expense of $1,714 and $3,102 are comprised of $1,238 and $2,279 in federal income tax and $476 and $823 in state income tax for the years ended April 30, 2023 and 2022, respectively.

The Company believes that its income tax filing positions and deductions will be sustained on audit and does not anticipate any adjustments that will result in a material adverse effect on its financial condition, results of operations or cashflow. Therefore, no reserve for uncertain income tax position, interest or penalties, have been recorded. 

The Company files income tax returns in the U.S. Federal jurisdiction and various state jurisdictions. The Company is no longer subject to U.S. Federal tax examinations for tax years beginning on May 1, 2019 and prior. There are no current tax examinations.